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Evening markets: sweet for juice, sour for grains

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Agricultural commodities put up a good fight against array of forces ranked against them, with the main grains narrowly failing to inch their way back into positive ground.

Orange juice, meanwhile, rocketed to a seven month high.

Many traders were expecting worse for grains, given the decline in share and oil markets, and the spread of so-called swine flu to China, which – reasonably or otherwise – might be expected to cut consumption pork, damage the country's growing livestock industry, and with it demand for animal feed.

Coupled with last week's rumours of cancelled Chinese soybean orders, it would have been easy to make 1 + 1 equal "sell".

Bulls off the rails

What's more, there was forthcoming data to worry about. Besides the weekly US planting data due later, the US Department of Agriculture will on Tuesday publish its monthly supply and demand report, which is expected to cut estimates for US soybean stocks.

"The bull market in the grains could be derailed this morning," Victor Lespinasse at GrainAnalyst.com said ahead of the floor opening in Chicago.

In the event, the bull looked more stumbling than derailed. May soybeans were 4.75 cents lower at $11.29 ¾ a bushel at 17:15 GMT, with July, the best trading contract, off 3 cents at $11.08 ½ a bushel

"The market is acting much better than expected following opening weakness," Mr Lespinasse said later in the trading day.

Corn and wheat did even better, helped by a swing on planting rumours to the negative from earlier talk that last week had been a good one for farmers.

May corn was 1.5 cents lower at $4.12 ¾ a bushel, with July down a mere 0.5 cents at $4.20 ½.

Wheat dips

For wheat, May was the better performing contract, down 0.5 cents at $5.80, with its July delivery comrade slipping 4.5 cents to $.86 ½ a bushel. Forward contracts lay between the two.

European wheats were a touch easier too, with London faring better thanks to a slip in sterling against both dollar and euro. While May wheat was £1.50 lower at £116.00 a tonne in London, most forward contracts slipped only £0.50 a tonne.

Paris May wheat dropped E1.00 to E145.00 a tonne, with August the worst performing contract, down E2.00 at E148.00 a tonne.

Earlier, palm oil also closed lower, down 25 ringgit at 2,660 ringgit a tonne for Bursa Malaysia's benchmark July contract, despite one report showing stocks at their lowest for nearly two years and another showing exports up 10% in the first 10 days of May.

The too-much-sunshine state

Softs eased too, with cocoa unsettled by comments from Jan Vingerhoets, head of the International Cocoa Organization, that grindings would fall 6% in the year to September, their worst performance for half a century.

New York cocoa for July slipped $74 to $2,433 a tonne, with its London equivalent doing a little better, off £26 at £1,718 a tonne, thanks to the drop in sterling.

Sugar, meanwhile, fell further from the near-three-year highs set last week. London white sugar for August dipped $3.7 to $444.40 a tonne.

Orange juice was one of the stand-out performers, adding 2.5% to 93.15 cents a pound for New York's July contract, helped by drought in Florida.

While farms have sophisticated irrigation systems in place, "it's never the same as rain", as farmers say, with many growers fearing smaller fruit sizes in the 2009-10 season currently taking its early steps.

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